Japan honouring car pact, says official
A senior Japanese trade official yesterday dismissed fears trade friction with the United States would flare and said Tokyo was fully honouring a pact on access to its car and car-parts market.
'Take every aspect of the agreement. You cannot say that the Japanese government is violating its promise,' Osamu Watanabe, vice-minister at the Ministry of International Trade and Industry said of the pact signed in 1995.
US trade officials on Wednesday expressed concern about Tokyo's efforts to honour the agreement and about the growing two-way trade gap in cars and car parts, fanning fears that bilateral trade tempers are fraying.
US Trade Representative Charlene Barshefsky and Commerce Secretary William Daley yesterday released a letter to Japanese Transport Minister Makoto Koga expressing their 'concern over the pace and scope of recent deregulatory actions' by the ministry in the car parts market.
The two nations fought a bitter battle over vehicle trade in 1995 and only an eleventh-hour deal kept Washington from imposing hefty trade sanctions on Japanese car exports.
Currency market players are concerned that Japan's rising trade surplus with the United States could trigger another feud, which might send the yen soaring against the dollar in a replay of the 1995 scenario.
The complaints were coupled with Washington's announcement of data showing the trade deficit with Japan hit almost US$26 billion for the first six months of the year, compared with $22 billion in the same period last year.